Immigration and Taxes: Who has to Pay U.S. Taxes?
Created by FindLaw's team of legal writers and editors | Last reviewed January 23, 2018
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There are two classifications of people that the U.S. uses in regards to taxes: tax residents and non-tax residents. If you have immigrated into the U.S., you may be wondering how to figure out how immigration and taxes apply to you. What follows is an explanation of the interplay between immigration status and taxes.
There are many situations in which you may be required to pay United States taxes even if you are not a U.S. citizen. Whether or not you have to file and pay taxes depends on whether the government has classified you as a tax resident or not. For example, all permanent residents, or holders of green cards, are considered to be tax residents. Not all non-immigrant visa holders are tax residents, however. Even if you are not a tax resident, it may still be a good idea to file an income tax return if you have been working for an employer that withholds taxes from your wages - you might get a tax refund.
United States tax residents must report their entire income to the IRS and pay taxes. It does not matter whether the money was earned within the country or internationally, all income must be reported to the IRS. Reporting all of your income to the IRS does not mean that all of your income will be taxed by the U.S. government, however. Those decisions are governed by international tax treaties.
If you are a green card holder, you may be wondering how your immigration and taxes will work. As mentioned above, as soon as you acquire a green card, you are automatically classified as a United States tax resident and must report all of your income, whether earned abroad or domestically.
There is a common rumor circulating that the number of days you spend within the United States decides whether or not you are considered to be a tax resident, but this is only true for people who are in the country under nonimmigrant visas, not green cards. Even if you have a green card and you do not step foot in the United States all year, you still must report all of your income to the IRS.
Like almost every other taxpayer in the United States, green card holders must file an IRS Form 1040 each year by April 15th. If you fail to file your United States taxes as a green card holder, you may hurt your chances of becoming a U.S. citizen. Additionally, if you intentionally do not file your taxes, you may also be guilty of a crime which could result in the loss of your green card and your possible deportation. You should be able to find out more about your situation by visiting the IRS website.
Unlike holders of green cards, holders of nonimmigrant visas may or may not have to report income and pay taxes to the United States Government. Holders of nonimmigrant visas only become tax residents if they spend at least 183 days of the current year within the United States. So, if you spend 200 days in the United States and are a holder of a nonimmigrant visa, you will probably be required to report your income to the IRS.
In addition, there is a weighted system that could also put you in the category of a tax resident even if you spent less than 183 days in the United States during the current year. If you have been in the United States for a total of at least 183 "weighted" days during the prior three years in the United States, then you are also a tax resident, unless you spent less than 30 days within the US during the current year.
Under the weighted system, all days in the current year count as one day, all days in the previous year count as 1/3 of a day, and all days in the year before that count as 1/6 of a day. Add it all up, and if it comes out to at least 183 days, you must report your income to the IRS. This rule does not apply to certain governmental employees and other professionals and students, however.
If neither of these rules puts you in the category of a tax resident and you have a tax home in a different county, you may avoid being classified as a tax resident and will not have to pay U.S. taxes. If the IRS determines that you do not have a tax home in another country, however, it may decide that you are attempting to conceal your income from the government and force you to pay taxes anyway.
If you are confused about your immigration and taxes, you should go through the IRS and navigate to IRS Form 519, U.S. Tax Guide for Aliens, which can answer many questions.
Like green card holders, if you spend at least 183 days in the United States and are a holder of a nonimmigrant visa, you must file your taxes using IRS Form 1040 by April 15th and pay taxes on all income earned in the United States. Unlike green card holders, however, nonimmigrant visa holders do not have to pay taxes on earnings made outside of the United States.
Failing to file your U.S. taxes may be a criminal offense which could eventually lead to your deportation from the country. In addition, failing to follow tax laws could also jeopardize your chances adjusting your immigration status.
Immigration and Taxes: Have Your Questions Answered by an Attorney
Both the U.S. tax code and the immigration system can be quite confusing to understand. This is especially true if you're trying to figure out how the U.S. tax code applies to immigrants. If you're an immigrant who needs help understanding your tax obligations, it's a good idea to speak with an immigration attorney who can guide you through the complicated tax system and make sure you're complying with all applicable laws.
You Don’t Have To Solve This on Your Own – Get a Lawyer’s Help
Meeting with a lawyer can help you understand your options and how to best protect your rights. Visit our attorney directory to find a lawyer near you who can help.
Contact a qualified immigration attorney to help you with visa procedures.